In terms of forgiveness: I think the major sin is not shipping anything at all or perhaps worse, fulfilling some of your orders but not all of them. Even if you mess up the enclosures, perhaps you can ship everyone a prototype circuit board? Because surely, surely something physical arrived on your doorstep if you burned millions of dollars.
The problem is usually about being honest where the money went. Backers are mostly not aware of just how much money it takes to build stuff at scale and when the headline is "Bolt-o-phone goes under, $5M raised, nothing shipped" it's natural to say "so what the hell did you do with my money then?".
That and making wildly optimistic optional extras if the funding gets high enough... keep it simple and it'll ship!
The problem is usually about being honest where the money went. Backers are mostly not aware of just how much money it takes to build stuff at scale and when the headline is "Bolt-o-phone goes under, $5M raised, nothing shipped" it's natural to say "so what the hell did you do with my money then?".
That and making wildly optimistic optional extras if the funding gets high enough... keep it simple and it'll ship!